How "Poor" are America's Poor?

About the Author

Next week the United States Census Bureau will release its
annual report on "poverty" stating, as it has for many years, that
there are some 31 million to 32 million poor Americans, a number
greater than in 1965 when the War on Poverty began. Evidence
mounts, however, that the Census Bureau's poverty report
dramatically understates the living standards of low income
Americans.

Here is a sample of facts that will not be mentioned in next
week's poverty report.

* 38 percent of the persons whom the Census Bureau identifies as
"poor" own their own homes with a median value of $39,200.

* 62 percent of "poor" households own a car; 14 percent own two
or more cars.

"Poor" Americans today are better housed, better fed, and own
more property than did the average U.S. citizen throughout much of
the 20th Century. In 1988, the per capita expenditures of the
lowest income fifth of the U.S. population exceeded the per capita
expenditures of the median American household in 1955, after
adjusting for inflation.1

Better Off Than Europeans, JapaneseThe average "poor" American lives in a larger house or
apartment than does the average West European (This is the average
West European, not poor West Europeans). Poor Americans eat far
more meat, are more likely to own cars and dishwashers, and are
more likely to have basic modern amenities such as indoor toilets
than is the general West European population.

"Poor" Americans consume three times as much meat each year and
are 40 percent more likely to own a car than the average Japanese.
And the average Japanese is 22 times more likely to live without an
indoor flush toilet than is a poor American.

The Census Bureau counts as "poor" anyone with "cash income"
less than the official poverty threshold, which was $12,675 for a
family of four in 1989. The Census completely disregards assets
owned by the "poor," and does not even count much of what, in fact,
is income. This is clear from the Census's own data: low income
persons spend $1.94 for every $1.00 in "income" reported by the
Census. If this is true, then the poor somehow are getting $0.94 in
additional income above every $1.00 counted by the Census. Indeed,
the gap between spending and the Census's count of the income of
the "poor" has grown larger year by year till, now, the Census
measurement of the income of poor persons no longer has any bearing
on economic reality.

Ignoring Billions of DollarsA key reason that the Census undercounts the financial
resources of the "poor" is that, remarkably, it ignores nearly all
welfare spending when calculating the "incomes" of persons in
poverty. Thus, as far as the Bureau is concerned, billions of
dollars in in-kind benefits to poor Americans have no effect on
their incomes. Out of $184 billion in welfare spending, the Census
counts only $27 billion as income for poor persons. The bulk of the
welfare system, including entire programs that provide non-cash aid
to the poor, like food stamps, public housing, and Medicaid, is
completely ignored in the Census Bureau's calculations of the
living standards of the "poor." The missing welfare spending that
is excluded from the Census Bureau poverty reports comes to $158
billion, or over $11,120 for every "poor" U.S. household.

The Census Bureau's poverty reports should be replaced by a new
survey that counts income and assets accurately. With accurate
counting, the number of poor persons would be shown to be only a
small fraction of the Census Bureau's current estimate of 31.8
million.

Behavioral Effects of WelfareHowever, the fact that there are fewer Americans living in
material poverty than the official Census poverty report indicates,
does not mean that the War on Poverty has been a success. Welfare
spending seriously diminishes work effort and earned income. The
largest effect of increased welfare spending is not to raise income
but merely to replace self- sufficiency with dependence. Welfare
also undermines family structure. In 1965 the black illegitimate
birth rate was 28 percent; today it is 64 percent. Properly
measured, the number of persons in material poverty has shrunk
since 1965, but at the unnecessary cost of producing a burgeoning
underclass. The current welfare system has created entire
communities where work is rare, intact families virtually unknown,
and dependence on government a way of life passed on from
generation to generation.

HOW THE CENSUS BUREAU UNDERSTATES
INCOME

The most comprehensive survey of welfare spending is provided by
the nonpartisan Congressional Research Service (CRS) of the
Library of Congress. The CRS tracks state, local, and federal
welfare spending in 75 "means-tested" programs, which are programs
with benefits restricted to persons with low or limited
income.2 The CRS figures include programs targeted to
low income persons such as Aid to Families with Dependent Children
(AFDC), food stamps, and public housing. By contrast, the CRS does
not include programs available to the general population, such as
Social Security.

In fiscal 1988, the CRS recorded $173 billion in means-tested
welfare spending at all levels of government.3 There was
an additional $11.2 billion in Medicare spending on poor persons
that year which was not included in the CRS total.4 The
CRS means-tested figures plus Medicare benefits for poor persons
yield a total welfare spending of $184.2 billion in 1988.

During the presidency of Ronald Reagan, Americans were inundated
by media reports of draconian cuts in welfare spending. But, the
CRS data show otherwise.5 Today, welfare spending is at
an all-time high. Adjusted for inflation, welfare spending at the
state, local, and federal levels rose consistently through the
1980s. As Table 1 shows, welfare spending in constant 1988 dollars
rose from $156.6 billion in 1980 to $184.2 billion in 1988. The
total comes to $5,790 for every poor person in the U.S., or $23,160
for a family of four.

The Missing Billions

The Census Bureau considers a household as "poor" if its income
falls below a specified "poverty income threshold." In 1988 the
poverty income threshold for a family of four was $12,675. That
year, the Census Bureau estimates there were 33.3 million people
who were poor before receiving welfare benefits; after receiving
welfare benefits the number of poor persons fell to 31.9
million.6 In other words, according to the Census
Bureau, $184 billion in welfare spending reduced the number of poor
persons in the U.S. by only 1.4 million, or $131,570 in spending
for each person lifted out of poverty. How is this possible?

The answer is simple: In counting the incomes of poor persons
the Census Bureau actually excludes almost all welfare assistance.
Some 75 percent of welfare spending in the U.S. is in the form of
"non-cash" assistance. Yet the Census Bureau ignores all non-cash
benefits in determining the income of poor persons. Non-cash
programs such as food stamps, public housing, energy assistance,
school lunch and breakfast programs, and the Women, Infants, and
Children's (WIC) food program are excluded from the Census Bureau's
poverty calculations entirely.

Thus, the Census Bureau counts most persons receiving non-cash
welfare as poor even if the total value of the welfare assistance
received greatly exceeds the poverty income thresholds.

Example: In 1988, many indigent elderly couples in New York
state received income support from the Supplemental Security Income
program and public housing assistance worth, on average, $12,290.
These couples also received Medicaid benefits costing an average of
$7,548. Despite the fact that they received welfare benefits with
an average value of $19,838, compared to the official poverty
income threshold in 1988 of $7,704 for elderly couples, the Census
Bureau counted such elderly persons as "poor."7

Example: In Massachusetts in 1988 a welfare mother with three
children could receive welfare benefits in the form of AFDC, food
stamps, public housing, Medicaid, and school lunch and breakfast
programs costing the taxpayers $18,765 per year. The poverty income
threshold for such a family that year was $12,092. But the family
would still be counted as poor by the Census Bureau.

Contradicting ItselfThe misleading income figures used in the Census Bureau's
annual poverty reports even contradict other Census data. Each year
the Census Bureau undertakes a detailed survey of family
expenditures to determine spending on rent, food, clothing,
transportation, medical care, entertainment, and other items. While
the Census Bureau poverty survey estimated that the average annual
income of the poorest 20 percent of U.S. households in 1986 was
$5,904, the Bureau's Consumer Expenditure Survey showed that these
same households were spending an average of $11,477 that year. Thus
the Census Bureau found that low income households spent $1.94 for
every $1.00 of income reported in the Bureau's own income
estimates. 8 A small part of this discrepancy might be
explained by some retired or temporarily unemployed individuals
spending their savings. But a major part is due to excluded welfare
income.

Underestimating the Welfare State

Table 2 analyzes the discrepancy between CRS and Census Bureau
figures on welfare spending. According to CRS and other government
sources, welfare spending was at least $184 billion in 1988. But
the Census Bureau counted only $27 billion in welfare assistance
when measuring household income. Part of this difference can be
explained by welfare spending on persons in nursing homes and other
institutions. These Americans are not included in the population
surveyed by the Census in compiling its incomes and poverty data.
Excluding welfare spending on persons in institutions, total
welfare spending still equalled at least $155.6 billion, so the
total funds "lost" by the Census Bureau poverty reports amounted to
$128.7 billion in 1988.

Why the "Poor" Will Always Be With
Us

The Census Bureau not only counts the number of poor persons in
the U.S.; it also calculates the "poverty gap." This is the total
amount of government assistance that would be needed to raise the
income of all poor Americans up to the poverty income threshold. In
1986, the last year for which data are available, the poverty gap
-- before persons received any welfare benefits -- was $64.9
billion. 9 After taking welfare benefits into
consideration, the Census Bureau put the poverty gap at $48.8
billion.10 Thus, according to the Bureau, $126.2 billion
spent on non-institutionalized persons in 1986 shrank the poverty
gap by just $16.1 billion. Every $1.00 reduction in poverty, in
other words, required at least $7.80 in welfare spending.

Besides the exclusion of non-cash aid in measuring the impact of
government assistance, two other factors help explain why enormous
welfare spending appears to make such a small dent on poverty.
First, up to 10 percent of all cash welfare spending is diverted to
administrative costs. Second, the government distributes up to half
of all welfare spending to persons who have low incomes but are not
below the poverty line.

The implications of these figures are sobering. The total
pre-welfare poverty gap in 1990 is approximately $70 billion. Given
the Census Bureau's current methods of measuring income, if the
government expanded the existing welfare system, which provides 75
percent of benefits in non- cash assistance and targets nearly half
of all aid to non-poor persons, it would require a staggering $546
billion in welfare spending -- or 46 percent of the total federal
budget -- to eliminate "poverty" in the U.S. As long as the Census
Bureau continues to count poverty with its current methods, the
U.S. inevitably will have a large number of "poor" persons every
year for the foreseeable future.

EXAMINING "POVERTY" IN AMERICA

In addition to the serious deficiencies of the Census Bureau's
measurement of income, the government's view of what constitutes
"poverty" would be surprising to most Americans. Government data on
the possessions of officially poor households starkly contradict
the general public understanding of what it means to be "poor."

Example: Nearly a third of all "poor" American households
have microwave ovens.11

Example: Sixty-two percent of "poor" households own a
car, truck or van. Fourteen percent own two or more
cars.12

Example: According to government figures, over 22,000
"poor" households have a heated swimming pool or a
Jacuzzi.13

Today, officially "poor" households are more likely to own
common consumer durables such as televisions and refrigerators than
the average family in the 1950s. In 1930, nearly two-thirds of U.S.
households did not own a radio; over half had no form of
refrigeration. Among the poor today, less than one percent lack a
refrigerator.14

Seventeen percent of U.S. households in "poverty" have automatic
dishwashers, well above the rate for the general West European
population in 1980.15 Among America's "poor" there are
344 cars per 1,000 persons.16 This is roughly the same
ratio as exists for the total population of the United Kingdom. A
poor American is 40 percent more likely to own a car than the
average Japanese; 30 times more likely than the average Pole; and
50 times more likely than the average Mexican.17

Housing Conditions of the "Poor"

According to the 1987 U.S. Census Housing Survey, 38 percent of
poor households own their own homes, with a median value of
$39,205.18 Nearly 50 percent of officially poor
households are air conditioned. 19

The homes of these households, whether owned or rented, also are
on average quite spacious by historic or international standards.
By American standards, "crowded" housing means more than 1.5
persons occupy each room. Less than 2 percent of "poor" U.S.
households were "crowded" in 1987, according to this definition,
and only 7.5 percent of poor households had more than one person
per room.20

On average, officially poor U.S. households have 0.56 persons
per room, which means they have more space than that available to
the average American household in 1970, and the average West
European household in 1980.21 By contrast, the average
Japanese lives in a home with 0.8 persons per room, the average
Mexican lives in a house with 2.5 persons in a room, while the
average citizen of India lives in a house with 2.8 persons per
room.22

Nearly all officially poor U.S. households, moreover, are
equipped with basic modern plumbing, including running hot and cold
water, indoor flush toilets and indoor baths. While 30 percent of
all Americans were without indoor toilets, in 1950, less than 2
percent of poor Americans lacked them by 1987.23 As
Table 7 shows, America's poor are less likely to lack indoor
plumbing than the general population in Western Europe. The average
Japanese is 22 times more likely to lack an indoor toilet than is
an American officially classified as "poor."

The houses and apartments of America's "poor" are in far better
condition than generally assumed. The median age of such housing
units is only seven years greater than the median age for the
overall U.S. housing stock.24 The overwhelming majority
of this housing is in sound condition. According to the 1987
American Housing Survey of the U.S. Census, only 2.4 percent
of housing units owned or rented by households deemed "poor" had
significant structural defects such as crumbling foundations or
missing roof material.25 Some 9 percent of poor
households reported being uncomfortably cold at least once during
the previous winter due to inadequate insulation, inadequate
heating capacity, or equipment failure.26 This was
roughly double the rate for the general population.

Food Consumption Of Low Income
Americans

On a per capita basis, low income households in 1988 spent 80
cents on food for every $1.00 spent by the median American
household.27 And out of every food dollar spent by low
income persons, 32 cents was spent in restaurants.28

Surveys conducted by the Department of Agriculture show
relatively little difference in overall food consumption between
high and low income households. Though the food purchased by low
income households normally is of lower quality and less expensive
than that consumed by the upper middle class, there is little
evidence of material shortages. For instance, the average low
income person eats 95 percent as much meat as the average person in
the upper middle class. Measured in pounds of food consumed per
week, low income persons actually consume 114 percent as much
poultry, 109 percent as much fish and 92 percent of the fresh
vegetables consumed by the upper middle class.

Table 9, derived from studies conducted by the Nutrition
Information Service of the U.S. Department of Agriculture, shows
the average nutritional status of persons from three income
groups:

Low income persons, from the least affluent 20 percent of the
population.

Persons receiving food stamps, and those whose income is low
enough to be eligible for food stamps but who did not actually
receive them.

Upper middle class persons from the most affluent half of the
population.

The table compares average food consumption in each of the three
income groups to USDA recommended nutritional standards. For all
three groups food consumption exceeds the standards in almost every
nutritional category. Differences between the upper middle class
and poor in almost all cases are quite modest.

Food Consumption of Poor ChildrenMany advocates have expressed concern about malnutrition caused
by poverty among young children. In 1985 the Department of
Agriculture conducted a thorough study of the food consumption and
nutritional status of pre-school children. This study showed very
little difference in the nutritional content of food consumed by
low income as compared to affluent Americans. Children from
families with incomes below 75 percent of the poverty level
consumed 54.4 grams of protein per day compared to 53.6 grams for
children in families with incomes above 300 percent of poverty
(roughly $33,000 for a family of four in 1985).29 Black
pre-school children consumed 56.9 grams of protein per day compared
to 52.4 grams for white children.30 Surprisingly,
protein and calorie consumption was slightly higher among children
in the central cities than in the suburbs.31

Average consumption of nutrients was very high for pre-school
children of all income classes. Protein consumption among children
living in families with incomes below 75 percent of the poverty
level equalled 211 percent of recommended USDA
standards.32 Consumption of essential vitamins and
minerals among both high income and poor children generally
exceeded USDA standards, often by as much as 50 to 100 percent.
Shortfalls were found in the average consumption of iron and zinc,
but these were unrelated to income class or race.33

International ComparisonsRich and poor Americans typically eat rich diets in comparison
to the rest of the world. The item most associated with an
expensive diet is the level of meat consumption; as income
increases, the level of meat consumption increases sharply. Table
10 compares the level of meat consumption of persons living in the
20 percent of American households with the lowest incomes, with the
average citizen in various other countries. There is very little
difference in meat consumption between high and low income
Americans, but the differences between poor Americans and the
average population in the rest of the world are dramatic. Low
income Americans eat 75 percent more meat than the average Briton
and 61 percent more than the average Italian. In a nation allegedly
afflicted with a "hunger crisis," low income Americans eat twice as
much meat as the average Portuguese, and two and a half times as
much meat as the average Mexican, and nearly four times as much
meat as the average Brazilian.

Poverty and MalnutritionMalnutrition and hunger caused by poverty are virtually non-
existent in the U.S. Protein and overall caloric intake are the
most expensive factors of any diet. Nevertheless, in its extensive
surveys the U.S. government has found no evidence of significant
caloric or protein deficiencies among the poor.34
Indeed, being overweight is the number one dietary problem of both
rich and poor Americans.35

Poor persons have lower levels of serum cholesterol than
non-poor persons of the same age, sex, and race.36
Moderate deficiencies of certain vitamins and minerals such as
vitamin B6 and zinc occur in part of the U.S. population but are
unrelated to income class.37 Moderate calcium and iron
deficiencies do occur more frequently among poor women than non-
poor women. But such deficiencies normally are the result of the
type of food consumed rather than the amount of money spent on
food; simply raising the income of poor women would have little
bearing on the problem. A more efficient response would be to
distribute inexpensive vitamin and mineral supplements to adult
female recipients of food stamps and WIC assistance.

CREATING A NEW POVERTY REPORT

The Census Bureau's annual estimate of poverty does not provide
useful information about the standard of living of low income
Americans or the impact of antipoverty programs. The current
poverty report should be abolished and replaced with a new report
based on the following methodology:

The economic well-being of American households would be
measured using a detailed survey of household expenditures, not the
deficient "income" survey currently used.

For those households receiving government non-cash assistance,
such as energy assistance or public housing, the Census Bureau
would determine the full cost of the subsidy provided. Special care
would need to be taken to ensure that the number of Americans
receiving such programs was properly counted. The value of medical
benefits would be determined by what is generally termed the
"insurance value": the average cost of the benefits received by
individuals of a similar age and gender.

The survey would determine home ownership, housing quality, and
other household assets. If assets exceeded a certain level -- say
$15,000 -- the household would not be defined as poor.

Any household where expenditures plus the cost of additional
government benefits did not exceed the current poverty income
threshold, and which did not have assets above the fixed asset
limit, would be counted as poor.38

More Accurate PictureSuch a survey could be conducted readily by expanding the
existing Consumer Expenditure Survey undertaken by the Census
Bureau each year.39 The new survey would provide a far
more accurate picture of the economic conditions of poor households
than the current Census poverty reports. It would also give far
more useful information about the specific financial needs of poor
families, such as whether they lack sufficient funds for medical
care, food, or housing. Such a reformed survey still would show
that there are poor households in America. But by including all
cash and in-kind income, and making proper allowances for assets,
the number would be a small fraction of the 31.9 million poor
persons estimated by the Census in recent years.

WAS THE WAR ON POVERTY A SUCCESS?

About half of today's official "poor" actually are elderly
Americans with assets, working families who have suffered a
temporary job loss or a divorce, or self-employed persons hiding
income from the government. Few of these households are poor by any
normal standard, especially when assets and non-cash benefits are
counted.

The other half of the officially poor population consists of
what might be called the traditional poor: welfare families and
individuals and family heads with chronic underemployment. The
material living conditions of this group are far better than the
Census Bureau poverty reports suggest. Many have income and
benefits putting them well above the poverty thresholds. However,
it would be a mistake to conclude from this that the War on Poverty
has been a success. On the contrary, these households, intended to
be the primary beneficiaries of the welfare state, have turned out
to be its victims.

The explosion of welfare spending in the last 25 years may,
possibly, have raised the material living standards of some less
affluent Americans, but it has done so at an enormous cost in terms
of destroyed families, an eroded work ethic, and possibly
irreparable damage to the social and moral fabric of low income
communities.

Welfare DependenceThe strongest effect of welfare is to diminish work effort,
reducing earned income and thus making families more dependent on
welfare. In the mid-1970s the U.S. Department of Health Education
and Welfare undertook the most extensive and thorough controlled
experiment on the behavioral consequences of welfare ever attempted
in the United States: the Seattle/Denver Income Maintenance
Experiment, known as "SIME/DIME," involving nearly 5,000 families
over seven years. The SIME/DIME experiment showed that every $1.00
of welfare given to low income persons reduced labor and earnings
by 80 cents.40 In other words, while welfare is very
ineffective in raising the incomes of the poor, it is very
effective in replacing work with dependence. Recent national data
show that among the poorest 20 percent of U.S. households there is
only one full-time worker for every seven full-time workers in the
most affluent 20 percent of households.41

Tragically, the system designed to alleviate poverty in large
part has been responsible for destroying the work ethic in
low-income neighborhoods. There has been an enormous growth in the
number of non-working poor families since the advent of the "War on
Poverty." In the 1950s, nearly one-third of poor families as
defined by the Census Bureau were headed by adults who worked
full-time throughout the year. In those days the problem was low
earnings. In 1988, only 16.4 percent of poor families had full-time
working heads of households.42 Today, the problem is
that adults do not work.

Destroying FamiliesA second major consequence of welfare is the destruction of
families. The black illegitimate birth rate was 25 percent in 1963
when the War on Poverty began. Today it is 64 percent. If current
trends continue it will reach 75 percent within ten years. Recent
research by Shelley Lundberg and Robert D. Plotnick of the
University of Washington shows that an increase of roughly $200 per
month in welfare benefits per family causes the teenage
illegitimate birth rate in a state to increase by 150
percent.43 According to the Census Bureau, a single
parent family is six times more likely than an intact married
couple family to be officially poor.44 To a considerable
extent, the welfare state is generating poverty in the United
States.

The impact of welfare dependency also seems to spread from one
generation to the next. Children born into welfare normally remain
in the system for many years. Of the 3.8 million families currently
on AFDC, well over half will remain on welfare for over ten years;
many for fifteen or more years.45 Research shows that,
holding demographic and income variables constant, being raised in
a welfare family has serious negative effects on the behavior of
young adults and their life prospects, as indicated by factors such
as high school graduation, employment, criminal activity, and drug
use.46 And June O'Neill, Director of the Center for the
Study of Business and Government at Baruch College, City University
New York, has found that after adjusting for racial and
socio-economic differences, young women from AFDC families are
three times more likely to receive AFDC themselves, as
mothers.47

Material Poverty Versus Behavioral
Poverty

In the late 1920s the median household income in the U.S. was
around $1,600. After adjusting family incomes for inflation, over
half of the families in this period would be considered "poor"
using current official standards.48 Indeed, nearly all
adult Americans living today had a parent or grandparent who was
"poor" according to the Census Bureau definition adjusted for
inflation. Yet despite their low material standard of living, most
of these individuals from earlier generations were not "poor" in a
meaningful sense. Their behavior and values were middle class.

But many of today's poor, while having a material standard of
living above average Americans in an earlier period, are in another
more important sense, very poor. They are trapped in "behavioral
poverty": a vicious cycle of illegitimacy, destroyed families,
absent work ethic, crime, drug addiction, and welfare dependency.
Senator Daniel Moynihan, the New York Democrat, has stated that "in
many if not most of our major cities we are facing something like
social regression."49 The welfare state, while
transferring enormous financial resources to these lower income
Americans, adds to this "behavioral poverty," rather than relieving
it. And the Census poverty reports, by exaggerating poverty in the
U.S. and thereby stimulating even greater welfare spending, in a
real sense has added to the misery of these households.

CONCLUSION

It seems incredible to most Americans that so much can be spent
combatting poverty and yet millions of households remain poor. They
are right to be incredulous. The fact is that the annual Census
Bureau poverty reports vastly overstate the number of American poor
because in determining who is "poor" they ignore assets and
dramatically undercount the incomes of low income households.

An accurate examination of the expenditures, food consumption,
housing, and assets of so-called poor families shows that there are
far fewer persons in poverty than the Census Bureau indicates.

The principal reason the Census Bureau undercounts the incomes
of the poor is that it deliberately ignores the effects of nearly
the entire welfare system. Programs such as food stamps, public
housing and Medicaid simply are excluded from the Census Bureau
poverty estimates. The total welfare spending ignored in this way
amounts each year to about $128.7 billion.

New UnderclassYet it would be a mistake to conclude that systematic errors by
the Census Bureau mask success in the War on Poverty. Vast welfare
spending designed to eliminate material poverty has in turn
generated a new underclass, destroying the work ethic, family
structure, and the social fabric of large segments of the U.S.
population. Most material poverty has been replaced by a far deeper
and more serious "behavioral poverty."

Census "Openness"For most of this century the Soviet government conducted a
"disinformation" campaign using government statistics to show that
the living standards of Soviet citizens were far higher than they
actually were. For thirty years the U.S. Census Bureau has, in
effect, been conducting a disinformation campaign suggesting that
the living standards of America's "poor" are far lower than, in
reality, they are. It is time for "glasnost" at the Census
Bureau.

Endnotes:

U.S. Department of Labor, Bureau of
Labor Statistics, "Consumer Expenditures in 1988," USDL Press
Release Number 90-96, February 26, 1990, Table 1. U.S.
Department of Commerce, Bureau of the Census, Historical
Statistics of the United States, Part I (Washington, D.C., U.S.
Bureau of the Census), 1975, pp. 297 and 301.

Estimate of percent of total Medicare
spending going to "poor" is based on Congressional Budget Office
figures showing 12.8 percent of Medicare recipients are
"poor."

Vee Burke, op. cit., p.
6.

U.S. Bureau of the Census, Money
Income and Poverty Status in the United States: 1988, P-60,
Number 166, p. 109.

Average Medicaid benefit values for
elderly persons in New York, excluding persons in institutions, is
provided in the U.S. Bureau of the Census, Technical Paper
Number 58: Estimates of Poverty Including the Value of Non-Cash
Benefits, 1987, (U.S. Government Printing Office, December
1988), p. 25. Supplemental Security Insurance benefits are provided
by in the House of Representatives, Committee on Ways and Means
"Green Book," 1989 edition, p. 683. Public Housing subsidies from
unpublished data provided by the U.S. Department of Housing and
Urban Development.

Ibid., pp. 46, 50. U.S.
Department of Commerce, Bureau of the Census, Statistical
Abstract of the United States: 1989, Table 1418. Comparison
based on cars per 1,000 persons.

Fifty-eight percent of "poor,"
owner-occupied households are non-elderly. Data from the U.S.
Department of Commerce and the U.S. Department of Housing and Urban
Development, American Housing Survey for the United States in
1987, Current Housing Reports H-150-87, pp. 34, 84, 114, and
304.

Ibid., p. 40.

Ibid., p. 38.

Living Conditions, op. cit.,,
p. 133. U.S. average computed from American Housing Survey
data, 1987.

Bureau of Labor Statistics, "Consumer
Expenditures in 1988," USDL Press Release, Feb.26, 1990, No.
90-96, op. cit., pp.90-6. Throughout this paper the term
"low-income" shall be used in reference to the one-fifth of
households with the lowest income in a given year, usually termed
the "Bottom Quintile." The term upper middle class shall refer to
the most affluent 50 percent of households.

Life Sciences Research Office,
Federation of American Societies for Experimental Biology,
Nutrition Monitoring in The United States: An Update on
Nutrition Monitoring, Report prepared for the U.S. Department
of Agriculture and the U.S. Department of Health and Human
Services, (Washington, D.C.:U.S. Government Printing Office, 1989),
p.51.

Ibid., p. 73.

Ibid., p. II 72-47.

Ibid., p. II 136-142.

In some cases a household could have
an income above the poverty threshold but expenditures below it.
Under the proposed system such a household would not be counted as
poor.

Technically, the proposed survey
would incorporate elements for the Survey of Income and Program
Participation, the American Housing Survey and the
Consumer Expenditure Survey.

Gregory B. Christiansen and Walter E.
Williams, "Welfare Family Cohesiveness and Out of Wedlock Births,"
in Joesph Peden and Fred Glahe, The American Family and the
State (San Francisco: Pacific Institute for Public Policy
Research, 1986), p. 398.

Robert Rector and Kate Walsh
O'Beirne, "Dispelling the Myth of Income Inequaltiy," The Heritage
Foundation, Backgrounder No. 710, June 6, 1989, p. 8.

Shelley Lundberg and Robert D.
Plotnick, "Adolescent Premarital Childbearing: Do Opportunity Costs
Matter?", June 1990, a revised version of a paper presented at the
May 1990 Population Association of America Conference in Toronto,
Canada.

Richard B. Freeman, "Who Escapes? The
Relation of Churchgoing and Other Background Factors to the
Socioeconomic Performance of Black Male Youths from Inner-City
Poverty Tracks," pp. 357-377 and Robert Lerman, "Do Welfare
Programs Affect the Schooling and Work Patterns of Young Black
Men?", pp. 403-443. In Richard Freeman and Harry J. Holzer. The
Black Youth Employment Crisis, 1986, University of Chicago
Press.

M. Anne Hill and June O'Neill,
Underclass Behaviors in the United States: Measurement and
Analysis of Determinants, Center for the Study of Business and
Government, March 1990.